The utility industry changes slowly – when it changes at all — but it now is under growing pressure from a variety of directions that are forcing change, according to engineering firm Black & Veatch’s annual industry survey.

Those pressures are leading to some pessimism and anxiety among the 548 utility industry executives surveyed.

Among the findings were:

• 96 percent said that there are acceptable renewable energy resources that can be added to meet load – that is up from 84 percent in 2010.
• 67 percent believed there are opportunities for earnings from “green” areas in the future.
• 80 percent of the respondents said they were embarking on a “major investment cycle” that would impact rates.
• 92 percent said rates would continue to rise.
• 56 percent said that coal has a future as a fuel source “when fiscal realities are fully considered. That is down from 82 percent in 2010.

“What we are seeing is the industry trying to navigate between ensuring reliable service and regulation,” said Mark Gabriel, a Black & Veatch vice president.

The Colorado Renewable Energy Collaboratory – a partnership between industry and the state’s top research institutions – has generated $37 million in federal and private research funds since 2007, according to a report to the legislature.

Created under a law, signed by former Republican Gov. Bill Owens, the goal was to draw together researchers from Colorado’s top research institutions, add a little state seed money and strike partnerships with industry on renewable energy projects.

“The aim was to connect resources, capital and research,” said David Hiller, executive director of the collaboratory.

As sketched in the Colorado Renewable Energy Administration’s 2012 report to the legislature, the collaboratory has a string of success including funding 66 research projects.

And the organization has stretched its initial three-year, $6-million appropriation to cover five years.

Still, the report says that renewable energy research was hurt by the 2008 recession and that despite the success in raising outside funds the organization “may need to seek another round of state funding.”

The money has created researcher centers focused on biofuels, solar energy, and wind power that brought together the University of Colorado-Boulder, Colorado State University, the Colorado School of Mines and the National Renewable Energy Laboratory in Golden.

Those centers, in turn, attracted big name companies to the program including Chevron and ConocoPhillips in the biofuels program, Total in solar and RES Americas and Vestas in wind.

The centers do research that is shared among its members and specific contracted research for individual companies.

The tally on research funding is:

• Private members contributed $4.18 million for shared research
• Private members paid $5.27 million for specific research
• The collaboratory obtained a total of $28 million in federal research funds.

By the time the 2008 recession hit, however, the initial state seed money was just about used up. The administration of former Democratic Gov. Bill Ritter helped the organization get $2 million from a federal “state stabilization” fund in 2010.

Industry support also fell off. For example, the number of companies participating in the biofuels center went to 14 in 2011 from 27 in 2008.

The collaboratory is continuing to search for alternative funding and is trimming the support for each research group, according to Hiller.

Danish turbine maker Vestas Wind Systems, which is largest in world sales and has built its American manufacturing operations in Colorado, was runner up with nearly 7,000 installed turbines with 9,000 megawatts.

All the other turbine makers – such as Siemens AG and Mitsubushi Heavy Industries – were far behind Vestas, according to a market analysis by SNL Financial.

The future, however, looks a little more uncertain as Vestas is in fourth place for projects in development. GE is once again the leader with 12,400 MW in some phase of development, followed by German manufacturer Siemans, 5,380 MW, and United Technologies Corp., 5,068 MW.Read more…

The renewable energy sector is headed for a financial and policy cliff, a group of Washington, D.C. “think tankers” warned in a study this week.

The study tallied 92 distinct policies and program that support clean tech – 60 of those have expired or are set to expire by the end of 2014 and federal cleantech spending is slated to drop to $11 billion in 2014 from $44.3 billion in 2009.

But this isn’t unnecessarily all bad say the authors of the study,“Beyond Boom & Bust” – which is a collaboration among researchers at the Brookings Institution, the World Resources Institute and the Breakthrough Institute.

“Many of today’s existing subsidies and clean energy programs, after all, are poorly optimized, characterized by a boom and bust cycle of aid and withdrawal,” the report notes.

“This is a chance to reframe cleantech policy,” said Mark Muro, a Brookings analyst and a co-author of the study. “We should start figuring out what the minimum of support should be,” Muro said. “How can competition and innovation be encouraged?”Read more…

“We are expecting to take power from the plant this quarter,” said Gabriel Romero, a spokesman for Xcel Energy, which has an agreement with Congentrix to buy the plant’s power for 20 years.

Solar Reserve and Cogentrix are both “concentrating” technologies but the similarity stops there. SolarReserve is proposing placing special sun-tracking mirrors – called heliostats—on 3,400 acres to focus the sun’s heat at two, 656-foot-tall towers holding molten salt reservoirs. The hot molten salt is used to heat water to turn a steam turbine.

Congentrix uses lenses to focus the sun’s rays on photovoltaic cells – but these cells are more akin to the high-performance, high-expense solar panels used in space craft. While the average solar panel converts between 16 percent and 20 percent of the sun’s light into electricity, Cogentrix says that its efficiency is around 40 percent.Read more…

In the battle to harness the sun’s power photovoltaic cells are winning out over concentrating solar power technology.

With prices for PV cells dropping 60 percent since 2009, to about $1.10 a watt at the end of 2011, photovoltaics are all the rage and plans for eight CSP projects in the southwest have been scrapped and replaced with PV. But adding more and more PV to the grid will come with its own financial and operating problems, caution two National Renewable Energy Laboratory researchers.

The solution to more PV, and more wind as well, say NREL’s Mark Mehos and Paul Denholm, may be more CSP.

What a difference and administration makes. After former Gov. Bill Ritter’s non-stop “New Energy Economy” – the centerpiece of his administration – Gov. John Hickenlooper has adopted a more modest tone.

And then there was the controversial Clean-Air Clean Jobs Act, which promotes shutting down old coal-fire plants and replacing them with natural gas.

“The Ritter administration was transformative in promoting renewables, shifting from coal to natural gas and moving toward a more balanced energy portfolio,” TJ Deora, director of the Governor’s Energy Office, said in an interview.

“But there is no appetite for energy legislation and funds are tight,” Deora said.Read more…

“We have subsidized oil companies for a century. That’s long enough. It’s time to end the taxpayer giveaways to an industry that’s rarely been more profitable, and double-down on a clean energy industry that’s never been more promising.”
–President Barak Obama’s 2012 State of the Union

To John Felmy, chief economist at the American Petroleum Institute, those are fighting words. “Taxing one industry to benefit another doesn’t work,” Felmy said in an interview in Denver.

At issue are a suite of tax treatments that the oil and gas industry have come to rely on, such an expensing intangible drilling costs and depletion allowances, accounting for costs of geological and geophysical analysis and a manufacturing tax credit.

Intangible drilling costs really aren’t intangible – they are the incidental costs of preparing a site, grading, drainage, salaries, etc. Depletion allowances enable an operator to account for the decline in a reserve.

“Sometimes it’s a question of whether something is expensed or capitalized,” Felmy said. “It isn’t a question of the federal government getting or not getting its money. It is just a question of when.”

“The oil industry hasn’t gotten any more than other industries,” Felmy said.

“You can’t say it’s fair to take money from a grandmother who has her savings in oil stocks or to raise the price of fuel for consumers,” Felmy said.Read more…

Tang the almost-orange-flavored drink came out of the NASA manned-space program and the Defense Department’s DARPA can claim at least partial parentage of the Internet.

The National Renewable Energy Laboratory in Golden, Colorado has no Tang or Google in its portfolio. True, there are more efficient wind turbines and blades, as well as solar panels, in the market due to NREL research – and some day maybe bio-fuel from switch grass.

Just no Tang. And that’s why nine Congressional Republicans, including Rep. Doug Lamborn of Colorado, last June, signed a letter urging an end to funding for NREL, saying renewable energy was being oversold.

That sparked a backlash from business and political leaders and a back-down from Lamborn. Why the strong reaction? A study out this week from the University of Colorado’s Leeds School of Business gives the reason or 831 million of them.

The study estimates that total economic benefit to the state at $831 million in 2011 – including $69 million in construction projects, as the lab builds out its campus, and $50 million in operating expenditures. That is up 11 percent from 2010.Read more…

Solar photovoltaic panel installations hit a national record 449 megawatts in the third quarter of 2011 – a 140 percent jump form the same quarter in 2010, according to a study by GMT Research and the Solar Energy Industries Association.

Almost 60 percent of the installations were in California and New Jersey – which have been the perennial leaders in solar installations. Colorado was seventh, down a notch when compare with the third quarter of 2010.

Here are the rankings for 3Q 2011, with last year’s place in parenthese

The overall cost of installed solar arrays (residential, commercial, utility-scale) fell 14.4 percent between the second and third quarters of 2011 to $4.45/W. That was driven by a drop in the price of utility-scale installations.

Residential system prices dropped 2.7 percent with the national average installed price decreasing from $6.41/W to $6.24/W. That was primarily due to price declines in major markets — including California, Colorado, New Jersey and Pennsylvania. In those markets, some system were being installed for less than $5.00/W, according to the report.

David joined The Denver Post in 1999, his second go-round in the Mile High City. Since then he’s covered a variety of topics – from human services to consumer affairs – most always with an investigative bent. Currently he does investigations and banking.